Could Bank Protests Make Your Savings be Safe Offshore Afterall?
Date: October 05, 2009
Lloyds TSB bank plc, one of the UK’s largest banks has recently been the subject of an undercover investigation by Panorama - televisions investigative current affairs programme. The documentary was intended to confirm allegations that banks and building societies are facilitating tax evasion by suggesting wealthy clients move their savings to non EU countries which provide tax havens in order to avoid taxes from both the UK and EU.
HM Revenue and Customs has intervened to ensure that the building societies understand and comply with the paragraph 5, schedule 36 of the Finance Act 2008 regarding information on Offshore Accounts. The schedule 36 notices require building societies to provide information and/or documents which they hold relating to any client who has a UK address and who are known to have or have held in the previous six years an offshore account. Although tax matters have always been managed by HMRC, the Financial Service Authority (FSA) is also now inspecting banks’, their structures on on lenders that could leverage more risk to our fragile economy. The FSA queries are wider and may result in unlimited fines and/or ban of specific bankers if they are found to be facilitating tax evasion.
A considerable number of banks among the 308 institutions that have been requested to comply with the schedule 36 notices refuse to provide such information and some are considering appealing against the requirement to provide information as the schedule requires. Banks are voicing concerns which they seem would breach and compromise their duty of confidentiality to clients and have further claimed that HMRC notices are misleading and unclear. Sue Holmes, head of tax investigations at Smith & Williamson justifies these claims by banks stating “There is a huge confusion among the banks. They want to help HMRC in any way they can, but the banks also have to balance this aim with maintaining client confidentiality.”
Both, HMRC and the FSA expect banks and business to be transparent and co-operative for the good of all. If you are responsible for your own tax payments, as an independent contractor, you should be ensuring your finances are kept in order by utilising a compliant umbrella company which will manage all tax issues on your behalf. Using OrangeGenie’s financial services will also provide tax efficient routes to insurance's and mortgages for contractors. Why not contact our sales team today for an informal chat to see how our umbrella services can help you as a UK contractor or freelancer.
